Xbox One will change everything: Microsoft
New Xbox One meant to be much more than just a game console, from a company that badly wants another win
Company promises a revolution in the way we interact with TV, games, entertainment content,
Microsoft Corp. is determined to own the living rooms of consumers around the world. With two failed attempts to do so already under its belt, the company makes its latest bid this week with the Xbox One, which hits stores Friday.
The company promises the new video-game console will change everything about the way people interact with TV, video games and entertainment content, mainly thanks to its high-tech camera sensor Kinect, which the company says is more precise and responsive than ever before.
In an industry dominated by colourful and unbelievable characters, Microsoft wants the Xbox One to be more than just a toy. The company is trying to fulfil its decade-old goal of conquering the living rooms of consumers everywhere.
Really, the launch is coming at a time when the computing giant needs lightning to strike. With stagnant or lacklustre sales of desktop PC software, tablet computers and phones, Microsoft Corp. is quietly hoping that Xbox One will help it attract some momentum that may have spinoff effects on its other areas of business.
With the console, Microsoft has promised better access to TV shows and movies through gestures, or simple natural speech, which Kinect will understand and interpret. A person who wants to watch hockey can simply say “Kinect, switch to CBC,” and the channel will instantly appear on the TV.
Integration with Microsoft’s Xbox Live service and various online entertainment offerings, including music and movies on demand, will be beefed up to provide users with more stuff to watch, listen to and do, using the console’s Internet connection.
Social networking integration, email, web search, video calling through Skype and even cloud storage will be offered through Xbox One.
Oh, and the console plays games, too.
Make no mistake, Xbox One is the anti-PS4 — the console Sony released a week ago.
The Xbox One’s bold and ambitious aim is to become the nerve centre of a person’s living room, allowing you to talk to friends, update your Facebook status, watch TV, download music and play video games, all on one console.
Microsoft has always coveted the living room.
The purpose of the original Xbox, released in 2001, was to help the giant from Redmond, Wash., secure a spot in the entertainment centre of millions of homes around the world.
The company sold more than 24 million units of that console, which paled in comparison to the 155 million units that Sony sold of the competing PlayStation 2. While exact figures aren’t available, it’s widely believed that Microsoft
A Microsoft product had actually become the focal point of the living room while other consoles such as Atari’s Jaguar, SEGA’S Dreamcast and SNK Playmore’s Neo Geo failed miserably, forcing their manufacturers to rethink their business plan or get out of the market entirely.
lost as much as $3.7 billion US on that console, or $168 on every console sold.
Still, the release of the Xbox accomplished a very lofty goal set out by the company. It proved that Microsoft could compete with the big bad names in gaming.
In some ways, largely thanks to the Halo franchise, it surpassed its competitors. It also quietly opened the door to multimedia sharing between a PC computer and an Xbox. For the first time, music and movie files could be transferred from a computer to be played on a game console, albeit in a very rudimentary fashion. Microsoft had finally found a way to crawl out from under the Windows PC brand and extend its grasp on the home of the consumer. It moved out of the office and onto a rack on your entertainment unit, where it could be proudly displayed next to a TV.
Microsoft was cool. For a company often depicted as boring and “beige,” it was a real moral victory.
A Microsoft product had become the focal point of the living room while other consoles such as Atari’s Jaguar, SEGA’S Dreamcast and SNK Playmore’s Neo Geo failed miserably, forcing their manufacturers to rethink their business plans or get out of the market entirely.
Despite lacklustre sales and large losses, Microsoft saw potential in its little Trojan horse, and executives at the company wanted more.
In an interview with Time Magazine in May 2005, Microsoft co-founder Bill Gates brushed aside the losses associated with the Xbox and said: “The first generation (of a game console), it’s just like a video game. If you play perfectly, at the end it says, ‘ You get to play again.’”
Microsoft’s second play was the Xbox 360, which brought with it voice commands, through Kinect, Internet browsing, Facebook and the ability to stream media content, including TV shows and movies, directly to a person’s living room TV. The Xbox 360 has sold more than 78 million consoles over the past eight years and pushed Microsoft’s Xbox Live, the company’s online gaming service, to more than 46 million paying subscribers.
The Xbox business now brings in more than $5 billion US in sales annually. In the three-month period from April to the end of June, Microsoft’s Devices & Consumer Hardware business unit, which includes the Xbox, accounted for $1.48 billion US in sales. That was during one of the slowest sales periods of the year.
This is why Microsoft is betting so heavily on the Xbox. The device is a hot commodity in the Microsoft stable at a time when its traditional Windows PC business is stagnant. Microsoft reported that sales for its Windows division hit $19.2 billion US during its latest fiscal year, which ended June 30.
That marked an increase of 4.6 per cent compared to the previous fiscal year — an incremental increase during a year that included the launch of the new Windows 8 operating system.
According to researcher Gartner, thanks to the momentum behind the tablet computer movement, PC shipments will fall another 11 per cent this year.
The company’s foray into the cellphone business, thanks to its $7.2-billion US acquisition of Nokia, hasn’t yielded the desired results. Windows phones now account for 3.6 per cent of all smartphones sold, according to recent statistics from market researcher IDC, a small increase over the two per cent they accounted for last year.
With a brand that is soaring in the video game industry, Microsoft is hoping the Xbox One will help reverse some of its recent fortunes. Thanks to the momentum it’s gathered in the industry so far, the company is preparing to play this game once more.
This time around, it’s positioning its popular Xbox console as an allin-one machine, aimed at providing something to every member of a family, while further strengthening its grasp, and by extension the Window’s OS, on the living room.
An Xbox One connected to a TV, will allow users to view or listen to entertainment content located on any Windows PC in the home. That’s on top of all the new content the company is offering through its online Xbox Live store.
By comparison, Sony’s PS4 is clearly marketed at video game aficionados. The system doesn’t yet allow for network streaming of multimedia files or even MP3 playback.
Whether video game fans buy into Microsoft’s vision of the future is another story entirely. There’s already been much debate about whether the new console will appeal to the market it needs. There’s also been a lot of debate over the console’s $499 price, which is $100 higher than Sony’s competing offering.
One thing is for sure, Microsoft is taking a leap of faith with this console that isn’t unlike the one it took with the first Xbox back in 2001. Whether the company gets another chance to play in this space in eight years time, will be up to consumers who now have to decide whose vision of the future appeals to them the most.